No revenues from state-owned enterprises

I’ve noticed that once you nationalize an industry the only setting is to run it at a loss. This is strange because that may be the case for example for the rail industry, the same can’t be said for energy or telecoms. Should there not be an ability to generate revenues from these industries? Historically state owned enterprises often create a net return for government. Look at for example the rates of return on SOE’s in Norway and Sweden.

10 Likes

This is a fair point. maybe at the bottom of the slider, there should be income generated, but it could create resentment by socialists and trade unionist and state employees that you are clearly choosing that, rather than paying higher wages for the workers?

4 Likes

I would say it depends. For example see the talking points from WeOwnIt - a UK based public ownership advocacy group. Many include the value of revenue of SOE’s, such as Royal Mail. https://weownit.org.uk/why-public-ownership/successful-examples

Some industries perhaps more than others could have this impact. Nobody expects a government to run a profitable rail service since that isn’t the objective. But everyone expects the government to have revenues from say, banking and publicly owned oil companies (ex; Norway, many Asian countries have publicly owned banks). I can see how this might extend to the ones simulated in-game.

Perhaps the degree of profitability- past a certain point it could have opinion maluses as you’d by hyper exploiting the workers in that company for it? But in that case there should also be the option to have it as a non-profit. It’s not like when the state takes over energy that people stop paying their energy bills.

Thanks for the answer Cliff! Great game.

2 Likes

I bought the game yesterday I have had done several runs through now and put in about 10 hours so far. These are my own views on nationalisation as it stands:

Who it influences:

The idea of nationalising industries is popular across the political spectrum, often for different reasons. On the extremes, both communism and fascism promote SoEs (State Owned Industries), but among the regular folk support is high. This YouGov poll shows how a majority of the country support nationalisation of different industries, including a majority of Tory voters for some industries. A majority of Brexit Party (nationalists) support the re-nationalisation of British Steel, so it could have an effect on patriot and patriot membership.

Effect of nationalisation:

As mentioned above, there has to be a mechanism for the SoE to make money. Many of the world’s most profitable companies are state owned. EDF, a major electricity provider in the UK is hugely profitable, and is owned (85%) by the French state.

I would recommend an option of sliding to the left makes the company run at a loss, with a higher number of staff, trade unions happy, lower poverty, lower unemployment. And the other way being run at a profit, still with a positive effect on unemployment, but less pronounced.

Memes:

After I nationalised the railway on both occasions the next turn fired a railway strike because of ‘under investment’. The Chinese state runs the largest and most modern railway in the world with thousands of miles of high speed rail. I think the idea of ‘stale British Rail sandwiches and strikes’ is a little hackneyed today.

Those are my thoughts on nationalisation for now. Thanks for taking the time to read them.

1 Like

The strike is definitely too rapid :smiley: although the strike is definitely mitigated if you do not have a strong trade union membership and workers-rights laws that make striking easy… And to be fair, in the UK it seems rail strikes are alarmingly common!

Regarding opinion polls, I agree and am definitely aware of the widespread support in many countries for nationalisation. However!.. don’t forget that the game is modelling individual facets of each voter, so for example many people in the game may on balance support nationalisation (perhaps as commuters) but thats aspect of them which is a capitalist is always going to oppose it.

Revealed preferences would suggest that nationalization is not very popular.

Thanks for the reply. It’s interesting how you have to configure the metric. Perhaps a fix would be to tack patriot support onto nationalisation to get around the capitalist part?

Oooh interesting. Do patriots support nationalisation? maybe they should…

2 Likes

Or that poll could be showing a preference in principle (having support from the socialist facet) that gets overwhelmed by practical concerns (such as commuter). Rail travel has tripled since privatization in the UK after all.

It tends to go up with population.

Pretty sure the population of the UK did not triple between the 1990s and now.

I feel like American patriots would not support nationalization of almost anything so I don’t know if this is something you can apply to patriots in general. Unless you want a group separate from patriots called fascists? Or a subsegment of patriots who are fascists? That would be interesting if the various groups that already exist had subsections so that they would be affected the same way for most policies with a few exceptions. For example, state employees could have different influences based on whether they work in state schools, state health services, police, or public rail.

I’ve also noticed that trade unionists get upset by body cameras. Presumably this refers to police unions, but I can’t imagine police unions getting along with other teacher unions or nurse unions for the purpose of general trade union membership. In America, at least, police are reviled in any leftist group. For example, the huge controversy and uproar that occurred when a prominent leader of the Democratic Socialists of America was found to have also organized for police unions on the side and he was forced to resign. Police unions are the only unions in America that are supported by the right wing, and they’re the only union that people on the left oppose. That kind of irreconcilable internal conflict between groups like trade union members mean it doesn’t make sense for something that cops don’t like to make nurses unhappy. If anything it would make other trade union members happy to see cops required to wear body cameras or even to see police unions dismantled.

Indeed, but the trouble is the simulation can then get so complex as to be unimaginable.

When I was a teenager we had the same thing. The coal miners were on strike and all the unions supported them, except the electricians unions who were accused of profiting from the strike!

Its obviously a simplification to lump all unions in together but we are trying to simulate the broader public rather than any extremes within a group. I’m pretty sure modders will at some point start adding this complexity though :smiley:

2 Likes

I’d like to see an option to run public services deliberately as not for profits, including state owned enterprises. So the idea would be they need balanced budgets and any profit is reinvested within, or something.

Well the current settings assume all public services are run at a loss of varying size, which is clearly nonsense and on my list of stuff to fix (so you could run the trains at a level where they earn money for the state, for example).

1 Like

State enterprise revenue should depend on global economy/GDP. The government can’t just decide it’s going to make a profit from its businesses.

The government can choose to charge more for the service in question than what it costs no maintain, no?

If it were that simple, no business would ever lose money, ever.

Well, not really. The point of nationalizing some serivice is that the government now has a monopoly on it. If it was a private business they would get outcompeted, this can’t happen when the government is the only allowed supplier.

1 Like

There is still the question of demand though. If we set the amount we’re spending on our national rail company with the expectation that we’ll make a profit off ticket fares and only half as many people use the train as we expected, the government will lose money.